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CMA Final · Direct Tax Laws and International Taxation · Double Taxation Avoidance Agreements (DTAA)

Mr. Arvind, a non-resident, wants to claim relief under a DTAA entered into by India. Under the Income-tax Act, 2025, which condition must he satisfy to be entitled to the relief?

A non-resident can claim DTAA relief only if he obtains a certificate of residence from the Government of the other country or specified territory and furnishes other prescribed documents and information. A self-declaration alone or a minimum foreign tax rate does not satisfy the statutory condition.

  1. AHe must obtain a certificate of his being a resident of the other country or specified territory from its Government, and provide other prescribed documents and informationCorrect
  2. BHe must have been resident in India for at least one earlier tax year
  3. CHe must file a declaration with the Indian Government only, without any residency certificate
  4. DHe must pay tax in the other country at a rate not lower than the Indian rate

Explanation

Section 159(8) says a non-resident can claim treaty relief only if he obtains a residency certificate from the Government of that country or specified territory and provides other prescribed documents and information. No condition about earlier Indian residence or comparison of tax rates appears there.

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